Keynote Address: Sanctions as an Instrument of American Foreign Policy

Haass, Richard N., Law and Policy in International Business

Good afternoon. As I look out at this crowd, I have mixed feelings. Normally, when I go out to speak, I get paid a tidy sum of money and have the luxury of speaking before people who are rarely experts. Neither of those is true today; I will not tell you which I regret more. I was asked to give a title for this talk, so the title I chose was (and I will not tell you how long I thought about it) "Sanctions as an Instrument of American Foreign Policy." While everyone in the title business knows that titles may or may not sell books, I actually think they do. In this case, the title actually bears some relationship to what I want to talk about. Again, it is sanctions as a foreign policy tool or instrument. What I would like to do is make the case for seeing sanctions as a tool and for trying to put them in the context of U.S. foreign policy. Then, at the end, I would like to spend a few minutes talking about how we ought to change the way we use this tool, which will affect both the substance of sanctions and how we make sanctions policy. I have about a half dozen ideas about what we might want to do to make this tool a more effective one. Let me first take you through my argument about sanctions. I will only make about five points, and then I will open it up to questions.

First, I do not think it helps to think of sanctions as something other than a tool. Tools should be judged largely for what they accomplish and how much they cost. It does not make sense to think of tools as something that simply make statements. Tools must bear a larger burden than simply making points. Instead, they should be about getting things done. As this is the case with any tool, sanctions are not unique and should be judged based on their impact.

What I would suggest as the starting point of this analysis is to think about the absolute costs and benefits of using a particular sanction, in a particular way, in a particular context. By absolute costs and benefits, what I mean is to take the sanction and look at how much it costs and what you get for it. Let me make two points related to that. One point is that critics should think about sanctions in this way: as something that should be subjected to rigorous cost-benefit analysis. In this sense, a lot of recent sanctions would have to be reconsidered. For example, sanctions were introduced against Pakistan after their recent nuclear test, nearly two years ago, in the spring of 1998. One has to ask, did those sanctions make sense given that one of their potential costs was pushing Pakistan over the brink, economically and politically? In each case, we must consider the cost in terms of, for example, the strengthening of an authoritarian regime, giving it greater control over the society and the economy. In the case of Haiti, a fairly strong case can be made that the sanctions imposed actually brought about the weakening of a society; so, in that case, they worked. One of the unfortunate side effects of that sanctions' success, however, is that there was an immigration flow towards the United States that was deemed politically unacceptable. This, in turn, led to an invasion of Haiti by 20,000 armed Americans, who fortunately were able to waltz their way in rather than fight their way in, but there was some uncertainty at the time. In the case of other sanctions, such as the Bosnian arms embargo, sanctions disproportionately hurt the one side that was most dependent on getting arms from the outside world rather than from the former Yugoslavia. Thus, cost-benefit analysis is important.

It is difficult, however, to accurately measure the cost and benefits. There are a number of problems with measuring the costs and benefits of sanctions; how you define the cost, whether it is to American business, to American consumers, or to foreign policy at large, and how you measure the cost in the target country, whether it is to the leadership, the citizens, or the economy. Similarly, the benefits are very hard to determine. …

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